Three listed companies of the Future Group have expressed their inability to declare financial results for the quarter and full year ended March 31, 2022, before the May 30 deadline, following resignations of directors.
Future Enterprises (FEL), Future Retail (FRL) and Future Lifestyle Fashions (FLFL) have said in separate regulatory updates that their present board and audit committee structures are not competent to approve the audited financial results. The companies are taking necessary actions to fill the posts they said.
Pursuant to cessation or resignation of a few directors (non-executive and independent) in recent past, the composition and structure of the board and the audit committee has become imbalanced and not in compliance with the Companies Act and Sebi regulations, FEL said on Tuesday.
It would not be possible to convene and hold meetings of the board and audit committee to approve the results before May 30. FEL said it would announce the results “as early as possible” after the composition of the board.
FRL and FLFL also said the same in similar updates.
According to regulations, listed companies have to announce their quarterly results within 45 days and full-year and fourth quarter (ending March) within 60 days.
Listed companies of the Kishor Biyani-led Future Group have been recording an exodus of senior executives after its Rs 24,713-crore with Reliance Industries failed to get shareholders’ and lenders’ approval.
Earlier this month, FRL’s chief financial officer CP Toshniwal resigned, effective May 12. In March, its chief executive officer Sadashiv Nayak resigned, seven months after he was appointed to the post. Prior to this, FRL’s director Rahul Garg had resigned from the company’s board.
On May 12, Biyani’s daughter Ashni Biyani resigned as managing director of Future Consumer, citing personal reasons. Ashni’s resignation followed that of Rakesh Biyani, who resigned as managing director of FRL a week before.
Other officials had also tendered their resignations along with Rakesh. The string of resignations also includes FRL’s company secretary Virendra Samani (effective April 30) and FRL independent director Gagan Singh.
FEL, meanwhile, has also been defaulting on interest payment on various non-convertible debentures.
In 2020, Future Group had signed a deal to sell its retail, logistics and warehousing businesses to Reliance Retail, a subsidiary of billionaire Mukesh Ambani-controlled RIL, for Rs 24,713 crore.
However, the deal became entangled in legal tussles after US e-commerce major Amazon opposed it, citing a 2019 agreement it had entered into with Future Group. Amazon, which had acquired a 49% stake in Future Coupons, the promoter entity of Future Retail, for about Rs 1,500 crore, alleged violation of certain terms in the 2019 deal. Later, RIL cancelled the deal after Future Group failed to secure shareholders’ and lenders’ approval.